FTC Proposes Civil Penalties for Deceptive Mortgage Advertising

September 23, 2010 -- The Federal Trade Commission issued a proposal to ban misrepresentations for all mortgages and allow the agency and the states to seek civil penalties against those who violate the rules. The proposal would prohibit all material misrepresentations in advertising about consumer mortgages and provides 19 examples of misrepresentations about fees, costs, obligations and other aspects of credit that would be violations. The rules would apply to mortgage lenders, brokers, and servicers; real estate agents and brokers; advertising agencies; home builders; lead generators; rate aggregators; and other entities under FTC’s jurisdiction. Currently, FTC may bring actions and seek injunctive relief against deceptive mortgage advertising. Under the proposal, FTC and state officials also would be able to seek civil penalties. The proposal would not include any advertising disclosure requirements, but FTC is soliciting views on whether there are advertising disclosures that the commission should include in the rules. The deadline for comments in Nov. 15. More information